Page 134 - Export and Trade

Shipping Incoterms
Signature Service ICC’sIncoterms ruleshavebecome FCA (‘Free Carrier’)
A service designed to provide the global standard for international The seller gives the goods, cleared
responsibility for the custody of trade. They have been translated into for export, to the buyer’s carrier at a
shipmentsintransit.Asignatureis more than 30 languages. VSHFL¿HG SODFH
required from each person handling The buyer is then responsible for
theshipmentateachstageof its International Commercial Terms JHWWLQJ WUDQVSRUWHG WR WKH VSHFL¿HG
transit. µ,QFRWHUPV¶ DUH LQWHUQDWLRQDOO\ SODFH RI ¿QDO GHOLYHU\ 7KLV WHUP
Tare Weight recognised standard trade terms is commonly used for containers
Theactualweightofthecontainer used in sales contracts. They’re used travelling by more than one mode of
8/' ZKHQHPSW\ to make sure buyer and seller know: transport.
• Who is responsible for the cost of
TotalCostofDistribution transporting the goods, including CPT (‘Carriage Paid To’)
Thesumtotalofall thecostsincurred insurance, taxes and duties. The seller pays to transport the
inthedistributionofgoods.This •Where thegoods should be picked JRRGV WR WKH VSHFL¿HG GHVWLQDWLRQ
includes:
•Transportationcharges. up from and transported to. Responsibility for the goods transfers
• Cost of capital tied up in inventory. • Who is responsible for the goods at to the buyer when the seller passes
• Warehousing expenses. each step during transportation. WKHP WR WKH ¿UVW FDUULHU
• Packaging.
• Insurance. The current set of Incoterms is CIP (‘Carriage and Insurance Paid’)
• Product obsolescence. Incoterms 2010. The next revision The seller pays for insurance as
• Pilferage. is not expected to be published ZHOO DV WUDQVSRUW WR WKH VSHFL¿HG
• Inventory taxes. until 2020. A copy of the full terms destination.
Note that distribution costs may vary is available from the International Responsibility for the goods
from product to product. Chamber of Commerce. transfers to the buyer when the
ULD (Unit Load Device) Incoterms apply to both national VHOOHU SDVVHV WKHP WR WKH ¿UVW FDUULHU
and international sales. They are &,3 µ&DUULDJH DQG ,QVXUDQFH 3DLG¶
Term commonly used to refer to air
freighted containers. used in contracts in a three-letter is commonly used for goods being
IRUPDW IROORZHG E\ WKH SODFH VSHFL¿HG transported by container by more
Unitisation in the contract (e.g. the port or where than one mode of transport. If
The practice of consolidating many WKH JRRGV DUH WR EH SLFNHG XS transporting only by sea, CIF is often
small pieces of freight into a single There are different terms for sea XVHG VHH EHORZ
unit. and inland waterways (e.g. rivers and
Warsaw Convention FDQDOV FRPSDUHG WR DOO RWKHU PRGHV DAT (‘Delivered at Terminal’)
A multilateral convention that of transport. There are also example The seller pays for transport to a
regulates the conditions of contracts and clauses available from VSHFL¿HG WHUPLQDO DW WKH DJUHHG
international transportation by air. the ICC. destination. The buyer is responsible
for the cost of importing the goods.
INCOTERMS: The buyer takes responsibility once
EXW (‘Ex Works’) the goods are unloaded at the
The seller makes the goods available to terminal.
be collected at their premises and the
buyer is responsible for all other risks, DAP (‘Delivered at Place’)
transportation costs, taxes and duties The seller pays for transport to the
from that point onwards. This term is VSHFL¿HG GHVWLQDWLRQ EXW WKH EX\HU
commonly used when quoting a price. pays the cost of importing the goods.
Example: Goods are being picked The seller takes responsibility for
up by the buyer from the seller’s the goods until they’re ready to be
premises in Auckland. The term used unloaded by the buyer.
in the contract is ‘EXW Auckland’.

132 NZ Export & Trade Handbook 2018